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Putin: Russia Will Honor Ukraine Loan, Energy Deals

Russian President Vladimir Putin (left to right), European Council President Herman Van Rompuy, and European Commission President Jose Manuel Barroso address a joint news conference in Brussels on January 28.
BRUSSELS -- President Vladimir Putin has pledged that Russia will honor its new economic deals with Ukraine -- even if the Ukrainian government changes as a result of the unrest roiling the country.

Speaking at a European Union-Russia summit in Brussels on January 28, Putin vowed that Ukraine will receive $15 billion in loans from Moscow, regardless of who is running the government.

He added that a deal with Kyiv for reduced prices on natural-gas supplies would also remain in effect.

Putin extended the loans and energy deal after the Ukrainian government decided against signing pacts on closer ties with the EU in November.

That decision triggered mass protests against President Viktor Yanukovych's leadership and demands for new elections.

The unrest has so far led to the deaths of least three people in clashes between demonstrators and police.

Confrontations between demonstrators and security forces are continuing in Kyiv and elsewhere in the country.

Moscow opposes Ukraine forging deeper links with the EU, instead urging Kyiv to join a Russian-led customs union of former Soviet states.

In his remarks in Brussels, Putin pledged that Russia would not interfere in the Ukrainian crisis.

He appeared to make a thinly-veiled reference to the visits to Ukraine of pro-opposition European and U.S. officials as the protest campaign has unfolded in the past several months.

"I can only imagine the reaction of our European partners should our foreign minister show up at an anti-European rally in the middle of a crisis in Greece or Cyprus to deliver slogans," he said. "We do not find it very nice in general, but bearing in mind the peculiarity of the relations between Russia and Ukraine, we find it absolutely unacceptable and impossible."

"The more intermediaries there are, the more problems there are," Putin added

EU President Herman Van Rompuy announced at the same press briefing that the bloc's foreign policy chief, Catherine Ashton, was expected to arrive in Kyiv on the evening of January 28 for talks with Ukrainians on the situation.

Standard & Poor's Lowers Rating

In related news, on the same day Putin made his remarks in Brussels, the Standard & Poor's ratings agency lowered Ukraine's credit rating, citing the political instability that's been gripping the country.

On January 28, the agency downgraded Ukraine from B- to CCC+, and changed Ukraine's outlook from "stable" to "negative."

A Standard & Poor's statement said "political instability in Ukraine has grown considerably."

It added that "the significant escalation of the political turmoil in Ukraine makes the expected financial support package from Russia less certain should the government of President Yanukovych fall."

The ratings agency also said that it would now "assess Ukraine under our criteria as exhibiting characteristics of a 'distressed civil society with weakened political institutions,' diminishing the government's capacity to maintain timely debt service."

With reporting by Reuters, ITAR-TASS, Interfax, and AFP
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